Rental hikes loom as state offers homebuyer incentive
Among some 50,000 apartment buildings nationally tracked by Redfin, the median monthly rent shot past the $2,000 in May, a first.
As Connecticut commits $20 million to help more people afford their first home — including in pricier communities — those who plan to rent another year are bracing for a sizable monthly increase at renewal.
On Monday, Gov. Ned Lamont announced a new, forgivable loan program called “Time to Own” through which the Connecticut Housing Finance Authority will help cover down payments and closing costs for those participating CHFA’s First-Time Homebuyer Program. Applicants can qualify for up to $50,000 if they are buying a house in what the state dubs “higher opportunity areas” defined by better schools and concentrations of higher-paying jobs, or $25,000 in cities and towns not meeting those criteria.
Information is online at www.chfa.org/timetoown or by calling 1-844-281-4663.
“Time to Own puts greater purchasing power in the hands of prospective homebuyers,” stated CHFA CEO Nandini Natarajan, in a Monday press release. “The program not only arms them with the means to purchase their first home, but it also gives them greater choice about where they and their families will grow and thrive.”
The rental market has been no safe harbor for people who have gotten priced out of purchasing a house or condominium meeting their needs. Among some 50,000 apartment buildings nationally tracked by Redfin, the median monthly rent shot past the $2,000 in May, a first.
New York City and a trio of outlying metropolitan areas in New York and New Jersey ranked among the 10 biggest increases in the past year, with the median rent up 24 percent to just over $4,000 a month as calculated by Redfin.
On its own study two weeks ago, however, Apartment List indicated one glimmer of hope: rents have risen at a slower rate this year, at 3.9 percent over the first five months compared to a 6.1 percent bump in 2021 between January and May.
But with ballooning inflation for gas, food and other needs, the pressure of escalating rent is hitting many hard.
Under the UniteCT program supported by federal pandemic aid, just over 40,000 Connecticut households struggling to make ends meet have received $276 million in assistance with rent and utilities, with another $124 million to be disbursed in the coming months.
The application window is now closed, but thousands of pending cases remain for renters awaiting a decision, including more than 2,000 in Hartford and a few hundred fewer in both Bridgeport and New Haven.
On Apartments.com, average rents in Stamford and Norwalk were above $2,300 a month as of Monday, with Danbury just below that price. The Bridgeport average was $1,300 with Milford at about $1,950 and New Haven about $1,850.
Hartford was a comparative bargain with an average rent of $900, but for those looking for extras like inunit laundry machines, rents for one bedrooms started at $1,250.
In an effort to get developers to build more affordable housing, the Connecticut Department of Housing is two years into what it calls its “developer engagement process” in which it has been meeting with builders and alerting them on affordable housing projects that qualify for tax credits.
Separately, in a series of meeting this spring a legislative Commission on Connecticut’s Development and Future has been studying the problem of affordable housing. The commission has been surveying Connecticut municipalities for an update on the status of affordable housing with plans to finalize recommendations later this year.
“It is intended to give towns a menu of options that they can consider,” said Tim Hollister, a commission member who is a land-use attorney in the Hartford office of Hinckley Allen, speaking earlier this month during a commission meeting. “There is no need to beat towns over the head for past conduct . ... We need to recognize past efforts and progress — we certainly need to recognize the value of things that sometimes bump up against affordable housing development, like open space preservation.”